Ann: WAV/RULE: BNZ: BNZ - Waivers from NZDX Listing Rules

• Release Date: 11/11/15 10:10
• Summary: WAV/RULE: BNZ: BNZ - Waivers from NZDX Listing Rules
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					BNZ
11/11/2015 10:10
WAV/RULE
NOT PRICE SENSITIVE
REL: 1010 HRS Bank of New Zealand

WAV/RULE: BNZ: BNZ - Waivers from NZDX Listing Rules

NZX Regulation Decision
Bank of New Zealand (BNZ)
Application for waivers from - NZX Debt Market Listing Rules 3.2.1(a),
7.12.2, 10.3 and 10.4

6 November 2015

Waiver from Rule 3.2.1(a)
Decision
1. On the basis that the information provided by Bank of New Zealand ("BNZ")
is complete and accurate in all material respects, NZX Regulation ("NZXR")
grants BNZ a waiver from NZX Debt Market Listing Rule ("Rule") 3.2.1(a) so
that the Deed Poll is not required to provide that the appointment of a new
trustee is to be approved by an extraordinary resolution of holders of BNZ
Notes ("Noteholders").
2. The information on which this decision is based is set out in Appendix One
to this decision. This waiver will not apply if that information is not or
ceases to be full and accurate in all material respects.
3. The Rule to which this decision relates is set out in Appendix Two to this
decision.
4. Capitalised terms that are not defined in this decision have the meanings
given to them in the Rules.
Reasons
5. In coming to the decision to provide the waiver set out in paragraph 1
above, NZXR has considered that:
a. registered banks are exempt from the requirement to have a trustee under
the Financial Markets Conduct Act 2013 in recognition of their alternative
regulatory supervision structure;
b. given that the general law recognises alternative regulatory structures
for registered banks (including prudential supervision by the RBNZ) NZXR
accepts that it is appropriate to grant a waiver from the requirements in
Rule 3.2.1(a), which would otherwise add an extra layer of supervision not
envisioned by the general law; and
c. NZXR has granted similar waivers in respect of debt issues by other
registered banks.
Waiver from Rule 7.12.2 in respect of Routine Payments of Interest
Decision
6. Subject to the conditions in paragraph 7 below, and on the basis that the
information provided by BNZ is complete and accurate in all material
respects, NZXR grants BNZ a waiver from Rule 7.12.2 in respect of routine
payments of interest on the BNZ Notes.
7. The waiver contained in paragraph 6 is granted on the following
conditions:
a. the timing of, and record date for, the routine payments of interest are
disclosed in the investment statement for the offer of the BNZ Notes (the
"Investment Statement");
b. the process for determining the interest rate and the date on which the
interest rate will be announced via NZX, are disclosed in the Investment
Statement;
c. the interest rate that will apply until the Optional Redemption Date  will
be announced via NZX on or before the date the BNZ Notes are issued; and
d. the waiver, its conditions and its implications are disclosed in the
Investment Statement.
8. The information on which this decision is based is set out in Appendix One
to this decision. This waiver will not apply if that information is not or
ceases to be full and accurate in all material respects.
9. The Rule to which this decision relates is set out in Appendix Two to this
decision.
10. Capitalised terms that are not defined in this decision have the meanings
given to them in the Rules.
Reasons
11. In coming to the decision to provide the waiver set out in paragraph 6
above, NZXR has considered that:
a. due to the possibility that the BNZ Notes may be Converted into ordinary
shares in NAB in certain situations, the BNZ Notes constitute Convertible
Debt Securities and the exception in Rule 7.12.4 does not apply;
b. although the BNZ Notes are technically Convertible Debt Securities, they
will have features typical of subordinated debt securities while they are
Quoted on the NZDX;
c. the interest payments to be made on the BNZ Notes are routine payments
(subject to BNZ's satisfaction of a solvency condition). The conditions set
out in paragraph 7 will ensure that Noteholders have certainty as to the
amounts (until the Optional Redemption Date) and timing of interest payments;
and
d. BNZ will be subject to Rule 7.12.6 and will be required to notify NZX
immediately, in the event that interest is not paid on the due date.
Waiver from Rule 7.12.2 in the Event of Conversion due to Non-Viability
Trigger Event
Decision
12. Subject to the conditions in paragraph 13 below, and on the basis that
the information provided by BNZ is complete and accurate in all material
respects, NZXR grants BNZ a waiver from Rule 7.12.2 so that, if Conversion of
the BNZ Notes occurs on account of a non-viability trigger event, BNZ is not
required to give notice for the purposes of Rule 7.12.2 in relation to the
Conversion, at least ten Business Days before the Conversion occurs.
13. The waiver contained in paragraph 12 is granted on the following
conditions:
a. the notice required by Rule 7.12.2 must be given as soon as practicable
and in any event before the NZDX opens for trading on the Business Day after
Conversion occurs;
b. the information required by Rule 7.12.2 which is known at the date of the
Investment Statement, is disclosed in the Investment Statement;
c. the waiver, its conditions and its implications are disclosed in the
Investment Statement.
14. The information on which this decision is based is set out in Appendix
One to this decision. This waiver will not apply if that information is not
or ceases to be full and accurate in all material respects.
15. The Rule to which this decision relates is set out in Appendix Two to
this decision.
16. Capitalised terms that are not defined in this decision have the meanings
given to them in the Rules.
Reasons
17. In coming to the decision to provide the waiver set out in paragraph 12
above, NZXR has considered that:
a. BNZ has submitted, and NZXR has no reason not to accept, that if
Conversion is required on account of a non-viability trigger event, it will
be unable to provide 10 Business Days' notice as required by Rule 7.12.2 as
the RBNZ and APRA standards require Conversion to occur immediately;
b. BNZ will be required, as a condition of this waiver, to disclose the
implications of this waiver in the Investment Statement. NZXR is satisfied
that this condition will inform Noteholders that upon the occurrence of a
non-viability trigger event, the market will not be given advance notice;
c. the condition in paragraph 13(b) will ensure that Noteholders will have
notice of all information about Conversion that is known at the date of the
Investment Statement. The condition in paragraph 13(a) will ensure that all
other information that is required to be disclosed under Rule 7.12.2 is
disclosed as soon as practicable; and
d. if a non-viability trigger event occurs, the terms of the Deed Poll
require BNZ to give notice to Noteholders as soon as practicable, that
Conversion has occurred.
Waiver from Rules 10.3 and 10.4
Decision
18. Subject to the conditions in paragraph 19 below, and on the basis that
the information provided by BNZ is complete and accurate in all material
respects, NZXR grants BNZ a waiver from Rules 10.3 and 10.4 in respect of
Debt Securities issued by BNZ.
19. The waiver contained in paragraph 18 is granted on the following
conditions:
a. BNZ's most recent disclosure statement (and any supplementary disclosure
statement) is available on BNZ's website and by contacting BNZ's registered
office;
b. a copy of BNZ's most recent disclosure statement (and any supplementary
disclosure statement) is sent to NZX by way of the market announcement
platform on an ongoing basis no later than it is made publicly available
elsewhere; and
c. if BNZ is required to provide a notification of interest payment under
Rule 7.12.2, holders of the BNZ Notes are notified by way of a sentence
included on each notification that BNZ's latest disclosure statement (and any
supplementary disclosure statement) is available for review at any of the
places mentioned in paragraph 16(a).
20. The information on which this decision is based is set out in Appendix
One to this decision. This waiver will not apply if that information is not
or ceases to be full and accurate in all material respects.
21. The Rules to which this decision relates are set out in Appendix Two to
this decision.
22. Capitalised terms that are not defined in this decision have the meanings
given to them in the Rules.
Reasons
23. In coming to the decision to provide the waiver set out in paragraph 15
above, NZXR has considered that:
a. the level of regulation that BNZ is already subject to as a registered
bank; including the requirement to prepare a disclosure statement quarterly
in accordance with the Registered Bank Disclosure Statement (New Zealand
Incorporated Registered Banks) Order 2014;
b. NZXR is satisfied with the level of disclosure in the disclosure
statements and the conditions of the waiver ensure that the latest disclosure
statement will be easily accessible to the investors;
c. BNZ is still subject to its continuous disclosure obligations under Rule
10.1, which requires BNZ to disclose any Material Information; and
d. there is precedent for this decision
Confidentiality
30.  BNZ has requested that this application and any decision be kept
confidential until BNZ has announced the offer of the BNZ Notes.
31.  In accordance with Footnote 1 to Rule 1.11.2, NZXR grants BNZ's request.

Appendix One
1. Bank of New Zealand ("BNZ") is a Listed Issuer that does not have any
securities Quoted on either the NZX Main Board or the NZX Debt Market
("NZDX").
2. BNZ intends to offer up to $300 million of subordinated unsecured notes,
with the ability to accept an unlimited amount of oversubscriptions ("BNZ
Notes").
3. The BNZ Notes will be classified as Tier 2 capital, for BNZ under both the
Reserve Bank of New Zealand's ("RBNZ") standards; and National Australia Bank
Limited ("NAB") under the Australian Prudential Regulation Authority's
("APRA") standards.
4. BNZ may elect to redeem all or some of the BNZ Notes on each interest
payment date, after five years or thereafter from the BNZ Notes' allotment
date ("Optional Redemption Date"), or if a specified tax or regulatory event
occurs. Redemption is subject to certain conditions being satisfied,
including BNZ obtaining the consent of the RBNZ and the APRA.
5. BNZ must redeem all of the BNZ Notes that have not previously been
redeemed, converted, or written off, ten years after BNZ Notes' allotment
date ("Maturity Date").
6. To qualify as Tier 2 capital, an instrument must fulfil certain criteria,
including providing a permanent and unrestricted commitment of funds, and
being freely available to absorb losses, if the bank is in financial stress.
The terms of the BNZ Notes must meet these criteria, in particular:
a. Subordination: BNZ Notes are subordinated in right of repayment to all
depositors and unsubordinated creditors of BNZ
b. Term: BNZ Notes have a term of ten years, subject to BNZ's right to redeem
the BNZ Notes on the Optional Redemption Date, or if a specified tax or
regulatory event occurs. Redemption prior to the Maturity Date is subject to
certain conditions being satisfied, including BNZ obtaining the consent of
the RBNZ and APRA.
c. Interest Payments: Interest payments are scheduled to be paid quarterly in
arrear, but are subject to the condition that BNZ is solvent at the time that
the interest payment is due and BNZ will remain solvent immediately after the
payment is made.
d. Loss absorption: all or some of the BNZ Notes may be required to be
converted into ordinary shares in NAB if a non-viability trigger event occurs
in respect of either BNZ or NAB. The point of non-viability is determined by
either the RBNZ or the statutory manager (in the case of BNZ) or APRA (in the
case of NAB). Loss absorption occurs as follows:
i. If BNZ is required to convert BNZ Notes because a non-viability trigger
event has occurred:
1. each BNZ Note that is to be converted will be transferred by the relevant
holder to National Australia Group (NZ) Limited (BNZ's immediate holding
company); and
2. NAB will issue to the relevant holder a number of ordinary shares in NAB,
determined in accordance with a formula set out in the deed poll for the BNZ
Notes ("Deed Poll"),
(together, the "Conversion");
ii. As a consequence of Conversion, holders will cease to hold the BNZ Notes
that have been Converted, and they will cease to have any rights under the
BNZ Notes; instead, they will hold ordinary shares in NAB. If for any reason
the BNZ Notes that are to be Converted are not able to be Converted when
required following a non-viability trigger event, those BNZ Notes will be
written off.
7. As a registered bank, BNZ is subject to the prudential supervision of the
RBNZ. Among other requirements, BNZ must publish quarterly disclosure
statements which contain financial information about BNZ.

Appendix Two
Rule 3.2   Trust Deeds for Debt Securities
Rule 3.2.1 Every Trust Deed governing Debt Securities shall provide that:
(a) the appointment of new trustee is to be approved by an extraordinary
resolution of the holders of the Securities to which the Trust Deed relates;
and
Rule 7.12   Announcements
Rule 7.12.2 Where any benefit is to be paid or distributed on Quoted
Securities (including dividends, interest or bonus issues) or any Conversion
of Securities or call on Securities is to take place, the Issuer shall give
to NZX, forthwith after any Director's recommendation and at least 10
Business Days before the Record Date to determine entitlements or
obligations, full details of the benefit, Conversion or call, including the
information in the table below. That information shall be supplied in the
form set out in Appendix 7.

Event  Information Required
Dividend   - Security description
    - ISIN
    - Total amount of dividend
    - Cents per share
    - Imputation tax credits per share
  (where applicable to six decimal  places)
    - Withholding tax cents per share
  (where applicable to six decimal places)
    - Source of dividend
    - Payable date
    - Record Date
    - Strike price for any issue in lieu of dividend
    - Excluded income per share (PIE Issuers only,
   where applicable to six decimal places)
    -    Foreign dividend payment credits per share   (where
applicable to six decimal places)
Interest Details no less than the equivalent required  above for a
dividend.
Bonus Issue Full details of the issue including timing, entitlement and tax
information.
Conversions Full details of the nature and timing of the Conversion including
pricing, entitlement and conversion ratio information.
Calls Full details of the call including the Securities affected, and payment
details.

Rule 10.3  Preliminary Announcements
Rule 10.3.1  Each Issuer shall make an announcement pursuant to Rule 10.3.2
through NZX for public release, in the manner prescribed by Rule 10.2 as soon
as the Material Information is available, and in any event;
(a)  before the release of each annual report, and not later than 60 days
after the end of the financial year to which that report relates; and
(b)  before the release of each half-year report and not later than 60 days
after the end of the financial half-year to which that report relates.
Rule 10.3.2  Each preliminary announcement, whether for a full year or a half
year, shall include the information and otherwise address the matters
specified by the relevant section of Appendix 1.
Rule 10.4  Annual and Half-Year Reports
Rule 10.4.1 Subject to Rule 10.4.3 each Issuer shall within three months of
the end of each Issuer's financial years:
(a)  Deliver to NZX electronically, in the format specified by NZX from time
to time; and
(b)  Make available to each Quoted Security holder in accordance with Rule
10.4.4,
an annual report. That annual report shall be delivered to NZX before or at
the same time as it is made available to Quoted Security holders in
accordance with Rule 10.4.4, and shall contain all information:
(c)  required by law;
(d)  required in a preliminary announcement by Rule 10.3.2; and
(e)  required by Rule 10.4.4, Rule 10.4.5 and Rule 10.4.7.
The financial statements in that annual report shall be audited and shall be
accompanied by an audit report in accordance with the requirements of the
Financial Reporting Act 1993.
Rule 10.4.2 Each Issuer shall within three months after the end of the first
six months of each financial year of the Issuer:
(a) deliver to NZX electronically, in the format specified by NZX from time
to time; and
(b) make available to each Quoted Security holder in accordance with Rule
10.4.4,
a half-year report. That half-year report shall be delivered to NZX before,
or at the same time as, it is made available to Quoted Security Holders in
accordance with Rule 10.4.4. That half-year report shall include the
information and otherwise address the matters prescribed by the relevant
section of Appendix 1.
Rule 10.4.3 An Issuer that is a State enterprise (as defined in the
State-Owned Enterprises Act 1986) is not required to issue to its Quoted
Security holders an annual report (in accordance with Rule 10.4.1) or a
half-year report (in accordance with Rule 10.4.2) until that annual report or
half-year report has been provided to the Minister responsible for the State
enterprise in accordance with the requirements of the State-Owned Enterprises
Act 1986 and laid by that Minister responsible for that State enterprise
before the House of Representatives in accordance with the State Owned
Enterprises Act 1986 or published in the Gazette under section 17(2A) of the
State-Owned Enterprises Act 1986, whichever is the earlier.
Rule 10.4.4 An Issuer shall make an annual or half-year report available to
Quoted Security holders as required by Rule 10.4.1 or Rule 10.4.2, by sending
to Quoted Security holders either:
(a) A copy of the annual report or half-year report (as the case may be); or
(b) A notice containing the statements referred to in section 209(3) of the
Companies Act 1993 and complying with sections 209A and 209B of the Companies
Act 1993.
Provided that for the purposes of Rule 10.4.4 and Rule 10.4.6, sections 209
to 209B of the Companies Act 1993 shall be deemed modified so that:
(c) references in that section to "shareholders" shall be deemed to be
references to members of the relevant Class of Quoted Security holders of
that Issuer; and
(d) in respect of an Issuer which is not a company, references to "company"
shall be deemed to be references to the Issuer; and
(e) in respect of a Managed Fund, references to "board of a company" shall be
deemed to be references to the Manager; and
(f) references to "annual report" shall (for the purposes of compliance with
Rule 10.4.2) be deemed to be a reference to a half-year report; and
(g) section 209(3)(d) shall not apply to the half-year report; and
(h) references to "annual report" shall be deemed to be references to an
annual report as required by Rule 10.4.1.
Provided also that an Issuer will be deemed to have made any half-year report
available to Quoted Security holders if that Issuer's most recent annual
notification under Rule 10.4.4(b) explicitly stated that it applied to the
next half-year report under the Rules. Where a half-year report is deemed to
have been made available in this way, a Quoted Security holder's election in
respect of receipt of the relevant annual report, if any, shall apply in
connection with that half-year report, except that an election to receive a
concise annual report must be treated to include an election to receive the
relevant half-year report.
Rule 10.4.5  The annual report of an Issuer shall contain:
(a) the information required to be published by Sub part 3 of Part 2 of the
Securities Markets Act 1988 and, in the case of a company registered under
the Companies Act 1993, the information required by section 211 of that Act;
and
(b) the names and holdings of Equity Securities of the holders having the 20
largest holdings of Quoted Equity Securities on the register of the Issuer as
at a date not earlier than 2 months before the date of the publication of the
annual report; and
(c) the Equity Securities, and Securities that may Convert to Equity
Securities, in which each Director has a Relevant Interest at the balance
date of the current financial year; and
(d) details of the spread of Quoted Security holders at a date not earlier
than 2 months before the date of the publication of the annual report; and
(e) the current credit rating status (if any) of the Issuer; and
(f) a summary of all waivers:
(i) granted and published by NZX in the 12 month period preceding the balance
date of the Issuer (or a reference to where a summary of waivers are
published on the Issuer's website, which summary must be available until
publication of the next annual report); and
(ii) relied upon by the Issuer.
(g) details of any exercise of NZX's powers set out in Rule 5.4.2 where the
exercise is already public knowledge; and
(h) a statement of any corporate governance policies, practices and
processes, adopted or followed by the Issuer; and
(i) a statement on whether and, if so, how the corporate governance
principles adopted or followed by the Issuer materially differ from the
Corporate Governance Best Practice Code or a clear reference to where such
statement may be found on the Issuer's public website; and
(j) a quantitative breakdown, as to the gender composition of the Issuer's
Directors and Officers as at the Issuer's balance date and including
comparative figures for the prior balance date of the Issuer. Comparative
figures are not required to be provided in respect of balance dates falling
in periods before the effective date of this Rule; and
(k) a statement from the Board of the Issuer providing its evaluation of the
Issuer's performance with respect to its diversity policy (if applicable);
and
(l) a statement as to which of its Directors are Independent Directors and
which of its Directors are not Independent Directors, as at the balance date
of the Issuer; and
(m) details of any Director who has been appointed pursuant to provisions of
the Constitution complying with Rule 3.3.8, and the Security holder which
appointed that Director.
Rule 10.4.6 Where a concise annual report is prepared in relation to the same
accounting period as an annual report, that report shall contain:
(a) The disclosures required by section 209(5) of the Companies Act 1993
(modified in the manner set out in Rule 10.4.4; and
(b) The information required by Rule 10.4.5(e), Rule 10.4.5(f) and 10.4.5(g).

Rule 10.4.7 Any Issuer which extends its half-year reporting period or
changes its annual balance date to a later date shall make a report
containing such information, and to be released at such time, as NZX shall
require in respect of the existing half-year reporting period or the period
ending on the existing balance date.
Rule 10.4.8 Each Issuer shall supply to any Advisor or Trading Participant
who so requests, free of charge, a copy of any document referred to in Rule
10.3 or Rule 10.4.
  ...
End CA:00273195 For:BNZ    Type:WAV/RULE   Time:2015-11-11 10:10:08